Bill Would Extend Ponzi Scheme Tax Breaks

Mar 26 2010 | 4:01am ET

Ponzi scheme victims would have recourse to millions in new tax breaks under a bipartisan proposal introduced yesterday in the U.S. Senate.

The measure, sponsored by Sens. Charles Schumer (D-N.Y.) and Jon Kyl (R-Ariz.), would extend the tax breaks to indirect investors in Ponzi schemes. Currently, indirect investors are eligible for neither existing tax breaks nor to file claims with the Securities Investors Protection Corp.  That would be a boon to thousands of investors who lost money in Ponzi schemes through their investments in pension funds, funds of hedge funds or feeder funds—such as many victims of the Bernard Madoff scandal.

The bill would also extend tax breaks—previously available only to victims who lost money only in taxable accounts—to users of pre-tax individual retirement accounts.

The relief would be available to victims of Ponzi schemes uncovered in 2008 and 2009, but might not cover frauds uncovered this year.


In Depth

Q&A: Quad Advisors’ Borish Is Looking For Real Traders, Not Index Huggers

Aug 20 2014 | 1:43pm ET

Peter Borish, who served as founding partner and director of research at Tudor Investment...

Lifestyle

Viking Manager In Rent Dispute

Aug 11 2014 | 4:14am ET

A hedge fund manager is demanding most of his money back from his former landlord...

Guest Contributor

Majority Of Inflows Go To Brand Name Hedge Funds

Aug 12 2014 | 9:00am ET

Since the market correction of 2008, a vast majority of hedge fund net asset flows...

 

Editor's Note

 

Futures Magazine

PREVIEW July/August 2014 Cover

Inside Futures' 500th Issue

The July/August 2014 issue is our largest in years—filled with the best trading strategies and stories from 43 years of being the primary publication for commodity, stock, options and forex traders.

The Alpha Pages

TAP July/August 2014 Cover

Real talk on alternative investments, business & finance

The Alpha Pages Editor's Note